Last week, the Reserve Bank of India and Bank of England shifted to focus on crypto. Regulatory concerns still pose risks to cryptocurrency price growth.
Bitcoin and the overall crypto industry crashed in 2017 – 2018, responding to regulatory actions. However, BTC and other crypto assets struck new ATHs this year. However, regulators still threaten the new asset class.
Bank of England
Bank of England revealed its worries about the cryptocurrency industry and highlighted the need to create a global framework during the weekend. The bank’s Financial Stability Report included a section focused on cryptocurrency assets.
When looking at three top headings, Mortgage Measures, Bank Resilience, and COVID and Economy, there’s no doubt that the Bank of England wants to introduce stiffer rules for greater market oversight.
The report highlighted that digital tokens pose limited risks to the United Kingdom’s financial stability. Nevertheless, the asset will include several stability challenges if it grows faster and as cryptos become increasingly interconnected with the global financial system.
Recent years have seen institutional investors increasing their cryptocurrency holdings and investments related to crypto projects. The BoE stated that a massive crash in digital coins’ value might force institutional investors to sell other financial instruments, potentially transmitting shockwaves in the financial sector.
BoE’s focus comes after Binance withdrew from Singapore amid regulatory issues recently. India and China are among the nations that have affected crypto assets. Recent sources revealed plans by the Reserve Bank of India to ensure a complete crypto ban. Market players expected the Indian parliament to ban some cryptocurrencies this week. However, RBI’s updates show that the parliament’s lower house did not evaluate the bill.
For now, the chances of a worldwide regulatory framework remain slim. That should then allow authorities to support cryptocurrencies price growth. However, anything can be possible at the moment as central banks consider developing CBDCs.
While publishing this news, Bitcoin traded 0.09% up at $46,942. Avoiding $46,680 would back an up-run to $48,000 before the day’s end. However, the $48,500 resistance remains vital as far as short-term price movements are concerned.